SHIJIAZHUANG -- Hebei Iron and Steel Group Co Ltd (HBIS), China's largest steelmaker, has acquired a 74.5 percent stake in a South African mining company, sources with the company said Wednesday.

Upon the completion of the transaction, HBIS will operate and manage Palabora Mining Company Limited (PMC) as its largest shareholder, the sources said.

The agreement was signed on Dec 8, 2012 between a consortium led by HBIS and Anglo-Australian mining giant Rio Tinto in Beijing.

According to the agreement, the consortium and South Africa's Industrial Development Corp would jointly purchase a 74.5 percent stake in PMC held by Rio Tinto and Anglo American plc. at a cost of $493 million.

"It is a great achievement by HBIS in coping with the tough market situation and securing upstream resources with a global outreach," said HBIS board chairman Wang Yifang.

The acquisition will help HBIS accumulate international operation and management experience, foster international management talents and create new investment value, Wang added.

Founded in June 2008 through the merger of Tangsteel and Hansteel, both located in north China's Hebei province, HBIS held assets worth 316.8 billion yuan ($51.1 billion) by the end of 2012 with that year's steel output reaching 42.84 million tons. It is also the world's second largest steelmaker after ArcelorMittal.